Containerized imported ferrous scrap prices increased this week amid rising offers, short supply of scrap and container shortage in most exporting countries. Mills stayed away from containerised purchases post a bulk deal for HMS 1&2 (80:20) from the US heard at $443/mt cfr late last week. Offers rose to $470/mt cfr this week.
A few buyers raised bids to secure material in anticipation of a further rise next week but offers rose further leading to no deal. Many steel mills in East Asia have resumed buying post annual maintenance.
The weekly Davis Index for containerized HMS 1&2 (80:20), Wednesday, rose by $51/mt from the prior week to settle at $419/mt cfr South Korea. Bids rose by $40-50/mt to 410/mt cfr, while offers rose to $425-430/mt. No deals heard yet as many steel mills found new offers unviable.
The weekly Davis Indexes for P&S 5ft and #1 HMS, Wednesday, rose by $51/mt and $52/mt to $445/mt and $428/mt cfr South Korea, respectively. The index for shredded rose by $52/mt to $435/mt from the prior week.
South Korean steel mills kept bids at JPY40,500/mt ($383/mt) fob, while offers rose to JPY42,000/mt amid rising domestic scrap prices. With higher purchases by Turkish mills on the back improving steel demand, the Turkish index rose $27.3/mt on Tuesday from prior Wednesday. Importers are cautiously watching Turkish and Chinese purchases before concluding any deal.
The Davis Index for domestic Heavy A rose by KRW10,000/mt ($9/mt) to KRW410,000/mt ($368.8/mt) and KRW395,000/mt delivered Incheon and Pohang, respectively. Few mills have raised bids for domestic scrap as yards refused to sell at lower prices on firm global ferrous scrap demand, said traders. Bids for Heavy A from Hyundai remained at KRW395,000/mt delivered Pohang from the prior week. Most mills are expected to refill inventories and offers are expected to rise on tight domestic supplies.
Exporters raised offers by $10/mt to $430-435/mt cfr in anticipation of a further rise in ferrous scrap prices globally. Rising finished steel demand and scrap shortage are driving offer prices higher. The Davis Index for containerized US-origin HMS 1&2 (80:20) rose by $5/mt to $428/mt cfr on Wednesday from the prior day. Bids remained flat at $420-425/mt on Wednesday with mills cautious of rising offers.
Traders indicated that most mills are active post-holidays and negotiating for South American and US containerised scrap. Mills are also tracking Japanese exports and South Korean import trends to gauge price direction.